News

The European Central Bank (ECB) has warned in a letter to the Commodity Futures Trading Commission (CFTC) that it might have to stop trading over-the-counter derivatives with US counterparties if it – and other eurozone central banks – are not granted exemptions from clearing, execution and reporting elements of the Dodd-Frank Act. The ECB also wants to be exempt from proposed rules on margining for uncleared trades.

A new venture is underway to make it easier to communicate collateral requirements electronically, which will be a key part of a more active market for clearing and trading over-the-counter derivatives.

U.S. regulators should define a new way of trading derivatives more broadly than any existing exchange or system so that requirements mandated by financial reform are as flexible as possible, according to Wall Street’s swap industry and lobbying group.

Banks and major swaps users would be limited to owning no more than 20 percent of derivatives clearinghouses, exchanges and trading systems, under a proposal by the Commodity Futures Trading Commission.